ISLAMABAD: The government on Friday constituted a private sector Board of Administrators of Export Development Fund (EDF) with immediate effect.

Comprising an overwhelming 16 members from the private sector, the EDF has been constituted under section 5 of the Export Development Fund Act 1999 (amended 2026), to look after administrative affairs of the EDF.

Led by Service Long March Tyres Ltd Chief Executive Omer Saeed, the board comprised Style Textile Pvt. Ltd CEO Shahzad Asghar Ali, Interloop Ltd Director Tariq Iqbal Khan, Artistic Milliners Pvt. Ltd CEO Yaqoob Ahmad, Nishat Mills Ltd CEO Mian Umer Mansha, Novatex Ltd Executive Director Shabbir Diwan, Verdora Ventures CEO Syed M. Mahd, Systems Ltd CEO Asif Peer, chairmen/presidents of the Pakistan Business Council, the Federation of Pakistan Chambers of Commerce and Industry, Rice Exporters Association of Pakistan, Surgical Instrument Manufacturers Association of Pakistan, Pakistan Sports Goods Manufacturers & Exporters Association, All Pakistan Meat Exporters & Processors Association and Pakistan Pharmaceuti­cal Manufacturers Asso­cia­tion.

Public sector members include secretaries or their BS-21 representative of the ministries of Finance, commerce, national food security, Industries & Production, chief executive of Trade Development Authority of Pakistan and Executive Director Export Development Fund and Dr Mohammad Saeed, Senior Technical Adviser on Trade, Customs and Institutional Reforms.

Published in Dawn, February 21st, 2026

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KARACHI: The Pakistan Virtual Assets Regulatory Authority (PVARA) on Friday announced approval and launch of a regulatory sandbox for virtual assets.

The announcement, shared on the authority’s social media platforms said PVARA “has formally approved and launched its regulatory sandbox for virtual assets.”

It adds that the “sandbox creates a live, supervised environment for testing real-world use cases, including tokenisation, stablecoins, remittances, and on- and off- ramp infrastructure under regulatory oversight”.

The post said that official guidelines for PVARA’s sandbox would be published in the authority’s website soon, but no details had been released until the time of going to press.

According to SECP’s website, a “regulatory sandbox is a tailored regulatory environment for conducting limited-scale, live tests of innovative products, services, processes, and/or business models in a controlled environment for a limited period of time.”

It further adds that this is “to assess their visibility to be launched on full-scale, and to determine the compatible and enabling regulatory environment that will be conducive for the innovative solutions.”

PVARA’s sandbox will allow for a controlled testing environment where web3 start-ups can trial innovative products and services under relaxed regulatory conditions, to inform new regulations that balance innovation and consumer protection.

Published in Dawn, February 21st, 2026

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• Rules provincial levy aligns with the constitutional division of powers
• Validates 2pc tax on contractors, developers, infrastructure projects
• Notes firms can claim input tax adjustments on goods

ISLAMABAD: The Federal Constitutional Court on Friday dismissed multiple petitions challenging the Khyber Pakhtunkhwa Sales Tax on Services Act, 2022, ruling that the provincial levy on construction services does not contravene constitutional provisions governing the division of taxation powers between the federal and provincial governments.

Headed by Justice Aamer Farooq, a two-judge FCC bench addressed a number of challenges against a May 13, 2025, Peshawar High Court judgement.

Petitioners including M/s Matracon Pakistan (Private) Limited, Anwar Khan, Khawaja Muhammad Khan, Zhongmei-Al Mehreen Joint Venture, Merryland Housing Society Mardan and Subhan Smart City Society Mardan had challenged Serial No. 14 of Schedule 2 to the act.

The challenged provision imposed a 2 per cent sales tax on services provided by construction contractors, architects, civil engineers, property promoters, developers, planners, interior decorators and allied professions.

It specifically covers construction services relating to structures, buildings, roads, bridges, underpasses, flyovers, electro-mechanical works, turn-key projects, and engineering, procurement and construction contracts.

Show-cause notices issued by the Khyber Pakhtunkhwa Revenue Authority demanded tax for the period from July 2021 to April 2022 on amounts received by the petitioners pursuant to construction contracts, which included the price of goods to be provided by the contractors.

The legal question before the FCC was whether Serial No. 14 of Schedule 2 was unconstitutional.

The judgement observed that after examining Entry 49 of the Constitution — which states “taxes on the sales and purchases of goods imported, exported, produced, manufactured or consumed, except sales tax on services” — the court found no inconsistency between the impugned law and the Constitution.

Entry 49 clearly stipulates that taxes on services cannot be imposed by the federation and the impugned law conforms to this mandate by imposing sales tax exclusively on construction services, the court said.

While the FCC acknowledged the petitioners’ concern that the revenue authority was levying tax on entire contractual amounts, it noted that Section 2(a) of the act defines “input tax” as cost incurred in the utilisation of goods for the execution of services.

The law allows registered persons to claim adjustments and refunds regarding tax paid under any other law on goods used in providing taxable services.

The FCC also addressed an ancillary matter regarding its jurisdiction to hear tax references not expressly enumerated in the Constitution. It held that Article 175E(5) of the Constitution authorises the FCC to call for the record of any case where a substantial question of constitutional interpretation arises.

The FCC observed that some constitutional provisions were “character-conferring” and also “competence-enumerating”. Article 175E(5) is of this kind, it said.

The court held that Article 175E(5) authorises the FCC to adjudicate matters involving substantial questions of constitutional interpretation, even in the absence of express jurisdiction. In the present case, the court said such a question squarely arose in the form of a challenge to the vires of the law.

The FCC concluded that Serial No. 14 of Schedule 2 to the Khyber Pakhtunkhwa Sales Tax on Services Act, 2022, was not ultra vires the Constitution. The judgement explained that the relevant constitutional and statutory provisions, when considered together, show no inconsistency.

Published in Dawn, February 21st, 2026

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